The wheel strategy is a popular options trading methodology that generates income through selling cash-secured puts and covered calls. Proper execution of the wheel strategy requires meticulous tracking of your Adjusted Cost Basis (ACB), premium income, and roll cycles. OptionWheelTracker is the ultimate tool for theta gang traders to manage their wheel strategy campaigns, automate ACB calculations, and achieve consistent options income. By accurately logging assignments, tracking dividends, and monitoring net premium collected, OptionWheelTracker empowers options traders to maximize their return on capital and effectively lower their break-even prices over time.
Stop getting confused by Wall Street jargon. Master the exact terminology you need to successfully execute the option wheel strategy.
The true break-even price of owning shares after subtracting options premiums received.
The obligation of an options seller to fulfill the terms of the contract (buy or sell shares).
An option whose strike price is equal to (or very close to) the current stock price.
The difference between what buyers will pay (bid) and what sellers want (ask) for an options contract.
The stock price at which a trade neither makes nor loses money, accounting for all premiums collected.
A contract giving the buyer the right to purchase 100 shares at the strike price before expiration.
When your shares are sold due to a covered call being assigned, completing Phase 3 of the wheel cycle.
The complete cycle of trades on a single stock from the first CSP sold to the final call assignment.
The profit realized when shares are called away at a price above the Adjusted Cost Basis.
An options strategy where you sell a put option while keeping enough cash in your account to buy the shares if assigned.
An options strategy where you hold long shares and sell call options against them to generate income.
The rate of change of an option's price relative to a $1 move in the underlying stock.
Quarterly financial results announcements that cause sharp IV spikes and large stock moves — high-risk periods for wheel traders.
The date on which an options contract becomes void and must be exercised or will expire worthless.
The portion of an option's premium that exceeds its intrinsic value — representing time and volatility expectations.
The rate of change of Delta for a $1 move in the underlying stock — highest for ATM options near expiration.
The market's expectation of how much a stock's price will fluctuate in the future, determining option premium prices.
An option where the current stock price is past the strike price, giving it intrinsic value.
The real, exercise-now value of an option — the difference between the stock price and the strike price when in-the-money.
A 0-100 score showing where current implied volatility sits relative to its 52-week high and low.
The net cash received after simultaneously opening and closing (or rolling) options positions.
The total number of outstanding options contracts that have not been settled or closed.
An option where the current stock price has not reached the strike price — it consists entirely of extrinsic (time) value.
The total price paid by an option buyer to an option seller.
A contract giving the buyer the right to sell 100 shares at the strike price before expiration.
The mathematical relationship between the prices of put and call options on the same underlying with the same strike and expiration.
Closing an existing option position and opening a new one in the same underlying asset with a different expiration and/or strike.
The predetermined price at which an option contract can be exercised to buy or sell the underlying shares.
The rate at which an option loses value as time passes.
The sensitivity of an option's price to a 1% change in implied volatility.